Vanadium Bulletin – April 2018

At the start of April, Core Consultants released the first of a new series of research bulletins aimed at offering accessible yet authoritative coverage of areas of increasing interest, starting with the recent vanadium pentoxide rally.

Last year, vanadium outperformed all other battery metals including cobalt and lithium to gain 130%.

Continue reading for excerpts from the report, or download it for free, now.

All Core Bulletins are priced at $39 for 39 days, at which point they become free, public resources.

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Chinese vanadium pentoxide increased from $9/lb at the start of December 2017 to $13/lb at the end of January, but the third week of March registered a whopping $15.5/lb for 98% min vanadium pentoxide.

When prices rise over 72% from a high base in less than three months, it piques investment interest. We want to understand why the price has behaved in this manner and more importantly whether it will continue to rise and for how long.

In order to answer this question, we break down the answer in the following way:

  • What has caused the vanadium price to climb to such levels?
  • Is this rally justified?
  • What is the predicted future behaviour of this commodity?

We analyse the global market, fully supported by research data, and provide a general outlook.

Excerpts are included here:

Looking at production by country, China, Russia and South Africa in 2014 accounted for nearly 100% of supply before Evraz Highveld’s Mapochs mine was closed and Vanchem was suspended, leaving South Africa with only Glencore and Vametco still operational. Furthermore, China's war on pollution saw its authorities banning scrap imports from the end of last year, which is expected to reduce the country’s vanadium pentoxide...

With respect to demand, there are two major prevailing trends, namely Chinese policies calling for better quality steel and the potential for redox flow batteries (VRB’s). Vanadium demand peaked in 2014 and then gradually declined following a lull in the high strength steel market and excess of fake rebar stocks on the Chinese market. Demand hit its trough in 2016, before rebounding by 14% y.o.y with the implementation of new steel standards and increased pollution control measures in...

In 2005, when the Chinese government last upgraded their rebar standards, vanadium hit an all-time high of $35/lb, triggered by a decline in Chinese inventory and the increased intensity requirement. Additionally, in the transport sector, more stringent Corporate Average Fuel Economy (CAFÉ) standards are increasing the usage of high strength, light steel in the automotive sector. Moreover, aircraft manufacturers are utilizing increasingly higher amounts of titanium-vanadium alloys with Boeing’s and Airbus’ new models using around 75-100 tonnes of vanadium alloys per...

VRB’s were originally conceived by NASA during the energy crisis in the 1970’s and have nearly unlimited charging and discharging capacity, are non-combustible and modular and are fully expected to complement the growth in grid-scale wind and solar generation capacity. On the upper end of analyst forecasts, VRB’s are expected to capture as much as 15-20% of the...

 

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